Discriminatory tariffs and international negotiations

Josh Ederington, Phillip McCalman

Research output: Contribution to journalArticlepeer-review

12 Scopus citations


Recent research has highlighted the efficiency of the MFN principle within the GATT/WTO structure. This paper analyzes the exception made to MFN within Article XXIII that allows discriminatory punishment for deviations from the agreement. We argue that, in the absence of collusion, the MFN exception reduces the severity of punishment and thus lowers the level of cooperation that can be achieved by the agreement. However, discriminatory punishment may still be beneficial as we show that it reduces the problems associated with the potential for renegotiation during the punishment phase. Finally, we argue that our results are also applicable to the question of whether to use trade policy sanctions as a means of enforcing agreements covering domestic policies.

Original languageEnglish
Pages (from-to)397-424
Number of pages28
JournalJournal of International Economics
Issue number2
StatePublished - Dec 2003


  • Dispute settlement
  • Non-discrimination
  • Trade agreements

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics


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